In First Month, More Than $5 Million in Taxes Collected from Major Remote Online-Only Sellers
Alabama’s 2016 holiday sales are on track to exceed expectations.
The Alabama Department of Revenue released its November sales tax numbers in early January, showing a 5.54 percent increase over last November. Alabama Retail had projected a 3 percent growth in holiday sales, which include sales that occur in November and December. The Revenue Department won’t release final numbers for December sales tax collections until early February. Alabama Retail will make its final report on holiday sales at that time. Alabama merchants have until Jan. 20 to make their December sales tax returns to the state. Nationwide, the U.S. Commerce Department reported a .6 percent increase in December sales over November and a 4.1 percent increase over December of last year.
The increase in sales tax collections is just part of the story. For the first time, purchases Alabamians made through Amazon and more than 70 other online-only retailers also added to Alabama’s November tax collections. Online-only sellers voluntarily remitted $5.79 million to the state in November in what is known as the simplified sellers use tax.* Those taxes are on top of what the state collected from other retailers through sales tax.
Other Alabama taxed sales in November were the highest on record. November taxed sales, other than remote, online-only sales, exceeded last November’s numbers by more than $10 million and topped November 2007, the previous high, by almost $15 million.
In Alabama, December sales tend to surpass November sales. If that trend continues, Alabama should, as predicted, exceed $11.4 billion in holiday sales for 2016. Holiday retail sales (November and December) nationwide increased 4 percent over 2015, according to the National Retail Federation.
SOURCE: Alabama Department of Revenue December Abstract, which reflects November sales. Alabama sales tax collections include general merchandise, automobiles, machinery, restaurants, other food services and vending.
* Simplified sellers use tax collections represent 8 percent of total sales.
This article, which originally appeared Jan. 6, was updated Jan. 13 to include simplified sellers use tax, U.S. retail sales for December 2016 and NRF holiday sales results.